By Duncan Mlanjira
Continuing with its corruption and fraud whistleblowing campaign, Human Rights Defenders Coalition (HRDC) has written the Minister of Finance Felix Mlusu to present a report to the nation on the status of toxic loans that “some politically connected individuals and companies owes the now defunct Malawi Savings Bank (MSB) that totals to a whopping MK6 billion.
The HRDC petition, issued on September 12, informs the Minister that Government sold MSB to FDH Bank and at the time is was being sold “some politically connected individuals and companies owed the bank over MK6 billion”.
HRDC further said the Finance Minister then, during the Democratic Progress Party (DPP), had told Parliament that Government would recover the money owed to the Bank.
Founded in 1994 after previous known as Post Office Savings Bank, Malawi Savings Bank was a commercial bank licensed by the Reserve Bank of Malawi.
Prior to 2015, MSB was administered as a wholly owned parastatal company until July 3, 2016 when it was acquired by FDH Bank.
In the petition, HRDC lists companies that allegedly owe MSB and they are:
• Mulli Brothers (MK4.6 billion);
• Sterling Timbers (MK1.4 billion to set up a timber processing plant in Chikangawa Forest but was never built);
• Varibo Spirits (MK397 million);
• KJ Transways (MK172 million);
• Ganizani Transport (MK97 million);
• Maranatha Institute of Education (MK83.9 million);
• Consolidated Building Contractors (MK71 million);
• CK Construction (MK69.8 million);
• K Investment (MK65.9 million)
“It is alleged that the above listed companies are owned by people aligned to the then ruling DPP,” says the petition.
“It is alleged that Government did not recover the loans because the borrowers were supporters of the ruling party.
“We have always seen banks seizing houses and property from unconnected people. HRDC believes that all Malawians ought to be treated equally.
“We are therefore calling upon your honourable office to inform the nation on the status of these so called toxic loans and what you intend to do about them,” says the signed by national chairperson, Gift Trapence and national coordinator, Luke Tembo seconded by regional chairpersons — Happy Mhango (North); Madalitso Banda (East); Masauko Thawe (South) and Billy Mayaya (Centre).
HRDC is on a whistle blowing campaign and recently the government lending its credence to the concerns expressed by European Investment Bank (EIB) over the deploying of Godfrey Itaye — answering alleged charges of fraud and corruption — to become Chief Executive Officer for Lilongwe Water Board (LWB).
The EIB has written the Ministry of Finance that it has considered the request to increase the financing of the project — under Lilongwe Drought Resilience Programme — from Euro12.5 million to Euro15 million but the financing is waiting the approval of the executive management later this month.
This development, according to the EIB letter, is causing considerable concern since the EIB is in the process of obtaining approval from the its Executive Management for the financing of the TWIII, it had hoped to conclude the finance contract with the Ministry of Finance by the end of the year.
In its petition to the government, HRDC said it strongly feels that the country should not wait for donors to tell it to do what is right.
HRDC reminded government that they are so many of corruption cases of suspects still holding critical positions in Government.
Earlier, HRDC also whistle brew on dubious acquisition of land by high profile officials and a procurement contract award by Ministry of Health to a Zambian firm Grandview International to provide ambulances at exorbitant prices yet Toyota Malawi quoted at a cheaper price at less than US$25,000 and offered 2 years of free service of the vehicles.
HRDC has also written the ACB detailing some allegations that the Roads Authority made some payments out of Treasury on the pretext that the money would be advance payment for construction of 10 road projects mainly in the Southern Region.
The letter, dated 3rd September, 2020 addressed to ACB Director General Reyneck Matemba, alleges that this was done during the campaign period for the fresh presidential election in which a total amount for the project was over MK46 billion (46,006,005,794.10) and that 20% advance payment was made but no works have started in the majority of the projects.